Obama vows intelligence cooperation to Germany's Merkel

U.S. President Barack Obama speaks about the economy at the Turner-Fairbank Highway Research Center in McLean, Virginia, July 15, 2014. Obama on Tuesday plans to highlight his administration's work alongside researchers and the private sector to develop vehicles that ''talk'' to each other using wireless technology.

WASHINGTON (Reuters) - U.S. President Barack Obama spoke to German Chancellor Angela Merkel on Tuesday for the first time since a new spy scandal dented relations between the two allies, and pledged to be in touch about ways to improve U.S.-German intelligence cooperation.

The call followed a difficult period in U.S.-German relations after Berlin told the CIA station chief last week to leave the country after officials unearthed two suspected U.S. spies.

Berlin said last week it had discovered a suspected U.S. spy in the Defense Ministry. That came just days after a German foreign intelligence worker was arrested on suspicion of being a CIA informant and admitted passing documents to a U.S. contact.

"The president and the chancellor ... exchanged views on U.S.-German intelligence cooperation, and the president said he’d remain in close communication on ways to improve cooperation going forward," the statement said.

The phrase "exchanged views" may suggest the two leaders were far apart on how they see the issue.

Merkel has said spying on allies is a "waste of energy." The White House, while being circumspect in what it would confirm about CIA activity, has said the issue should be resolved through diplomatic channels and not through the media.

The United States and Germany are important partners on a host of global conflicts. Obama and Merkel also discussed the violence in Ukraine and talks with Iran about its nuclear program, the White House said.

The two leaders reiterated that Russia had to take more steps to de-escalate the situation in eastern Ukraine by urging rebels to release hostages and by ending the flow of heavy weapons, equipment, and fighters across the Russian border.

"The leaders agreed that to date neither the United States nor Germany has seen Russia fulfill these required actions," it said.

Obama and U.S. officials have held a number of calls with European leaders in recent days about Russia in a sign that Washington is pushing for a new round of sanctions against Moscow.

U.S. Vice President Joe Biden told Ukraine President Petro Poroshenko on Tuesday that the United States was working with European allies on the issue amid what they cited as further acts of escalation from Russia.

"The leaders discussed Russia’s ongoing support for the separatists and apparent escalation of the conflict over the last few days," the White House said in a statement about the call between the two men.

"The vice president told President Poroshenko that the United States was engaging with European leaders to discuss the imposition of costs on Russia for its continued escalation of the conflict," it said.